Summary of the top business, economic and political news in Nigeria today.
- The federal government has unveiled the ownership structure of the modular refineries it proposed to build in the states of the Niger Delta region, explaining that the states, host communities and private investors would jointly own and operate the refineries. Link
- The Minister of Finance, Mrs Kemi Adeosun has said that the government will soon release N350 billion, being the first tranche for capital votes implementation of the 2017 budget. “We are ready, we are having a cash-plan meeting very soon and after that, N350 billion will be released as first tranche of capital releases for the 2017 budget,’’ she said. Link
- Despite the Federal Government’s plan to produce 200,000 metric tonnes of sugar yearly, its importation rate has risen. Findings revealed that between April this year and this year about 1.3 million tonnes of sugar worth N190.3 billion ($501 million) were imported from Brazil. Link
- The Nigeria Customs Service (NCS) Apapa Area Command has handed over the seven imported containers of fake pharmaceutical products from China to the National Agency for Food and Drugs Administration and Control (NAFDAC) in Lagos. Link
- The Standards Organisation of Nigeria (SON) has uncovered over N8billion worth of cloned cables at two residential buildings in the Ajangbadi area of Lagos. Its enforcement team uncovered the warehouses, where 20 different brands of cloned cables were kept. Made-in-Nigeria cables and other brands like NOCAN, Surecan, Necaco, Kablemex, Purecan and Nigertin, among others, were cloned in China. Link
- A mortgage firm has returned to the Economic and Financial Crimes Commission (EFCC) the N500 million said to be part of the Paris Club refund kept with it by a governor. Link
- The Oyo State government will install close circuit television (CCTV) cameras in strategic locations across the state, Governor Abiola Ajimobi said yesterday.The move, the governor said, would place Oyo among the league of states and communities under the “safe city project”. Link
- The Federal Government has unveiled a $300 million World Bank facility to support a new housing scheme known as the National Housing Finance Programme (NHFP). The initiative, according to the Deputy Director, Other Financial Institutions at the Central Bank of Nigeria (CBN), Mr. Adedeji Adesemoye is a Public Private Partnership (PPP) programme, designed to improve more access to financing housing projects in the country. Link
- INTELS Nigeria Limited has kicked against the decategorisation of port terminals by Nigerian Ports Authority (NPA) because it is not in the interest of the nation. The firm also warned that while it is a violation of the port concession agreement sealed and signed with the government, the action will lead to huge revenue loss to the Federal Government. Link
- Forte Oil Plc has said it is planning to sell shares worth N20bn to institutional and high net worth investors, and has applied for regulatory approval for the transaction. It said its core investor, Zenon Petroleum and Gas Limited, owned by billionaire, Femi Otedola, with a total stake of 62.97 per cent in the company, would not participate in the offer. Link
- The Akwa Ibom State government is determined to drag Total E&P Nigeria Limited to court over a tax liability of N25bn. A revenue consultant to the state government and Chief Executive Officer of Rom Flex Networks Limited, Mr. Eyo Bassey, said on Tuesday that TEPNG has been found to be serially negligent on its tax liabilities to the state government, noting that tax evasion is a criminal case. Link
- The vandalism of oil pipelines in the downstream sector of the petroleum industry recorded a drop of 12.77 per cent in April 2017, the monthly financial and operations report of the Nigerian National Petroleum Corporation has showed. Link
- Julius Berger Plc has announced its strategic partnership and joint investment with Petralon Energy Limited for the acquisition and development of oil fields in Nigeria. Link
- The House of Representatives Ad-hoc Committee on Shell Petroleum Development Company (SPDC) Relocation has praised the management of INTELS Nigeria Limited for sustaining high standards in its operations. INTELS implements international standards such as ISO 9001, ISO 14001, OHSAS 18001 and ABS Quality, which are unmatched in the maritime and oil and gas industries. Link
- Shell is considering whether to invest in a gas project in Nigeria’s southern Niger Delta energy hub, the managing director of the local unit said on Tuesday. Osagie Okunbor, managing director of Shell Petroleum Development Company of Nigeria (SPDC), said it was “on the verge of making a final investment decision” on a project in the city of Asa that would have a capacity of 300 million cubic feet. Link
- Etisalat has been instructed to transfer its 45 percent stake in Etisalat Nigeria to a loan trustee after debt restructuring talks with lenders failed, the Abu Dhabi telecoms company said on Tuesday. Link
- The transport section of Dangote Cement Ibese Plant has intercepted one of the company’s truck loaded with contrabands in Ibadan, and handed the drivers over to the Nigeria Customs Service for proper investigation and possible prosecution. Link
- The peace accord signed by the Federal Government and the Indian firm, Global Infrastructure Nigeria Limited, for the resolution of the Ajaokuta Steel Company’s legal tussle has been threatened by fresh demands by the GINL. Link
- Sinoma International Engineering Co Ltd has signed cement production contract worth $249.4 million with Nigeria’s Dangote Cement Plc. Link
- The Managing Director/Chief Executive Officer of the Asset Management Corporation of Nigeria (AMCON), Mr. Ahmed Kuru has disclosed that the corporation’s recent assessment of obligors as at December 31, 2016 identified 350 accounts with a current exposure of N2.5 trillion, representing about 80 per cent of AMCON’s total obligor debt. Link
- The Acting President, Yemi Osinbajo, on Tuesday said the Federal Government would soon release a second batch of the N701bn intervention fund to the Nigeria Bulk Electricity Trading Plc. Link
- Dr. Ifeanyi Ubah, the managing director of Capital Oil and Gas Limited has been released from DSS’s detention. Sources said the oil mogul was released yesterday night unconditionally by the Department of State Services after a “No Case” was established, following a tedious investigation by the DSS in his rift with the NNPC. Link
- United Capital Asset Management, a subsidiary of United Capital Plc, yesterday listed two billion units of the United Capital Wealth for Women Fund and 100,000 units of United Capital Nigerian Eurobond Fund on the Nigerian Stock Exchange (NSE). Link
- The federal government said on Monday it would use a fraction of the looted funds recovered so far to finance part of the 2017 budget. The Minister of Budget and National Planning, Udoma Udoma, said the total revenue projected was N5.08 trillion, with 11 per cent (about N559 billion) coming from the recoveries made. Link
- The Chairman, House of Representatives Committee on Banking and Currency, Hon. Sir Jones Chukwudi Onyereri, has said the House will not be lured into supporting the deceptive plot orchestrated by some people to lure Asset Management Corporation of Nigeria (AMCON) to purchase new debts from Deposit Money Banks (DMBs) in the country. Link
- The Speaker, Kano State House of Assembly, Kabiru Rurum, has denied a media report that he received N100m bribe to suspend the probe of Emir of Kano, Mallam Muhammad Sanusi II. Link
Flour Mills moves to diversify funding sources with N29.8 billion bond listing
Flour Mills Nigeria Plc lists N29.8 billion bonds to diversify funding sources from the Nigerian capital market.
Flour Mills Nigeria Plc’s fresh N29.8 bond listing will help the nation’s leading food business company to explore diversified funding sources from the Nigerian capital market, with the hope of enhancing growth and the development of the company.
This statement was made by the Group Managing Director of FMN, Mr. Omoboyede Olusanya, at the listing of the Tranche A and Tranche B bonds valued at N29.8 billion on the Nigerian Stock Exchange (NSE).
The food and the agro-allied company which has remained Nigeria’s largest and oldest integrated agro-allied business with a broad profile and robust Pan-Africa distribution issued these bonds under its N70 billion Bond Issuance Programme.
Olusanya said that the company would continue to explore funding opportunities inherent in the capital market to ensure business growth and continuity.
While speaking about the Credit Rating of the Programme, he disclosed that FMN’s credit rating, as well as the operational financing of the Group, have improved considerably.
According to him, the bonds floated by Flour Mill will help to strengthen the company’s capital base and provide the needed working capital required by the Company. He added that Flour Mills Group will continue to deleverage and replace short term financing with longer-tenured and lower price funding to optimize capital structure and reduce financing cost.
He noted that Flour Mills will continue to explore opportunities to raise fundings via the capital market as this enables the company to diversify its funding sources and continue to play a role in the capital market as a significant player in it.
What they are saying
The Group Managing Director of FMN, Mr. Omoboyede Olusanya, at the virtual event, said;
- “We are delighted with the response from the market, we are happy to be listed.
- “We are introducing an N29.9 billion listing under an N70 billion bond issuance cover; we will continue to raise funding to diversify our funding sources.
- “The company remains passionate about feeding the nation to improve the quality of living for Nigerians through increased production and investments in backward integration.”
What you should know
- With the successful issuance of the new N29.8bn Tranche A and Bonds, FMN has utilized its bond issuance program registered in 2018.
- It is important to note that the Senior Unsecured bond listing includes an N4.89bn under Series 4 Tranche A of the bond issuance programme, at a 5.5% rate for 5 years, due by 2025, and a 25bn under Series 4 Tranche B of the same program at a 6.25% rate for a tenure of 7 years, due by 2027.
- The bond proceeds will be used to refinance existing debt obligations. It will also help the company take collaborative actions to diversify the company’s financing options beyond expensive short term debt.
Lafarge moves to divest 35% shareholding in CBI Ghana
Lafarge Africa Plc has resolved to sell off its 35% shareholding in Continental Blue Investment Ghana Limited.
The Board of Lafarge Africa Plc has resolved to sell off its 35% shareholding in Continental Blue Investment Ghana Limited, in order to cut down on costs impacting the Group’s profit.
This disclosure was made in a notification tagged- “Notice of Divestment in Continental Blue Investment Ghana Limited”, which was issued by the Company Secretary, Mrs. Adewunmi Alode.
According to the statement, the Board of Directors of the Group made the decision to divest its 35% shareholding in Continental Blue Investment Ghana Limited (“CBI Ghana”), in line with the resolutions made at the emergency board meeting which held yesterday 20th, January 2020.
This move was made to set off the cement manufacturer on the path of sustainable growth and profitability, as Lafarge’s investment in CBI Ghana has depleted significantly over the years.
What you should know
- This is not the first time the company has had to sell off an unproductive investment in an effort to cut down on deadweight cost, as key players in the Cement industry like BUA and Dangote Cement continue to show strength and resilience through their effective cost minimization strategy which worked well in 2020.
- Recall that in August 2019, Lafarge Africa sold off all its stakes in Lafarge South Africa Holdings (LSAH). This move helped the company to cut down costs coming from its South African subsidiary, which had been making billions of naira worth of losses for years.
Multiverse forecasts N39.5 million profit in Q1 2021
The management of Multiverse Plc has projected a revenue of N76 million and a profit of N39.5 million in Q1 2021.
Multiverse Mining and Exploration Plc has projected that in the first quarter of 2021, the mining and exploration company will generate N76 million in revenue, and post a profit of N39.5 million.
These projections were made by the company in a recent earnings forecast issued by the Management, and signed by the Corporate Secretaries of the company.
Key highlights of the earnings forecast for Q1 2021
- Total revenue is projected at N76 million.
- Turnover from agency sale is projected at N1 million.
- Agency cost is s projected at N850 thousand.
- Total expenses are projected at N7.8 million.
- Operating Profit is projected at N67.3 million.
- EBIT (Earnings Before Interest and Taxation) is projected at N67.3 million.
- Interest Expense is projected at N27.8 million.
- Profit after tax is projected at N39.5 million.
Key assumptions made to support the earnings forecast and projection of the company
The earnings forecast was made on the ground that there won’t be any significant change in the economic policies of the Federal Government, while the monetary policies of the CBN would not be altered significantly.
The company also maintained that there would not be any industrial unrest that would affect its production and sales volume, while the profit of the company would not be pressured by rising costs of inputs, as prices of materials used in production shall be stable in the period under review.